The allocation of volatile assets on divorce


Capital assets on divorce can be loosely categorised as either volatile assets or copper-bottomed assets.

A copper-bottomed asset is usually real property such as the marital home. This asset may fluctuate in value but generally the value of a copper-bottomed asset is expected to rise over time. A volatile asset is one that is expected to fluctuate wildly in value, within very short periods of time. An example of this would be Bitcoin. It could also be one that could suffer a sudden serious diminution in value because of internal or external factors. An example of this might be company shares.

On divorce the court must decide how to allocate these assets. Sometimes the answer is obvious, a divorcing party who is a company director is more likely to retain company shares. He or she often has the capacity to increase his or her financial worth or income substantially over time. This defrays the risk somewhat of allocating the volatile asset to the party. The spouse may be left with the copper-bottomed house. He or she may appear to be the luckiest of the two but this might reflect the need to provide security for minor children and there is also the chance that the value of the property may be slower to rise and the occupant may be unable to influence that.

Nicola Furmston is a solicitor and head of the Family team at Barker Gotelee.

Family Solicitors in Ipswich – for more information on our range of legal services, please call the team on 01473 611211 or email bg@barkergotelee.co.uk